BEIJING and HONG KONG, July 21 /PRNewswire-Asia/ -- -- Quarterly
Net Revenues Increased by 47.9% Year-Over-Year -- Quarterly
Non-GAAP Net Income Increased by 58.0% Year-Over-Year -- Quarterly
GAAP Net Income Increased by 49.8% Year-Over-Year -- Fiscal Year
Net Revenues Increased by 45.6% Year-Over-Year -- Fiscal Year
Non-GAAP Net Income Increased by 34.6% Year-Over-Year -- Fiscal
Year GAAP Net Income Increased by 24.5% Year-Over-Year New Oriental
Education and Technology Group Inc. (the "Company" or "New
Oriental") (NYSE:EDU), the largest provider of private educational
services in China, today announced its unaudited financial results
for the fourth quarter and fiscal year ended May 31, 2009.
Highlights for the Fourth Fiscal Quarter Ended May 31, 2009 --
Total net revenues increased by 47.9% year-over-year to US$59.4
million from US$40.2 million in the same period of the prior fiscal
year. -- Non-GAAP net income, which excludes share-based
compensation expenses, increased by 58.0% year-over-year to US$7.1
million from US$4.5 million in the same period of the prior fiscal
year. GAAP net income increased by 49.8% year-over-year to US$2.6
million from US$1.8 million in the same period of the prior fiscal
year. -- Non-GAAP income from operations, which excludes
share-based compensation expenses, increased by 175.1%
year-over-year to US$7.0 million from US$2.5 million in the same
period of the prior fiscal year. GAAP income from operations
increased to US$2.5 million from a loss of US$0.2 million in the
same period of the prior fiscal year. -- Non-GAAP basic and diluted
earnings per ADS, which excludes share-based compensation expenses,
were US$0.19 and US$0.19, respectively. GAAP basic and diluted
earnings per ADS were US$0.07 and US$0.07, respectively. Each ADS
represents four common shares of the Company. -- Total student
enrollments in language training and test preparation courses
increased by 8.2% year-over-year to approximately 330,200 from
approximately 305,200 in the same period of the prior fiscal year.
Highlights for the Fiscal Year Ended May 31, 2009 -- Total net
revenues for the fiscal year increased by 45.6% year-over-year to
US$292.6 million from US$201.0 million. -- Non-GAAP net income for
the fiscal year increased by 34.6% year-over-year to US$77.8
million from US$57.8 million. GAAP net income increased by 24.5%
year-over-year to US$61.0 million from US$49.0 million. -- Non-GAAP
income from operations for the fiscal year increased by 43.6%
year-over-year to US$77.7 million from US$54.1 million. GAAP income
from operations increased by 34.4% year-over-year to US$60.9
million from US$45.3 million. -- Non-GAAP basic and diluted
earnings per ADS for the fiscal year were US$2.09 and US$2.03,
respectively. GAAP basic and diluted earnings per ADS were US$1.64
and US$1.59, respectively. Each ADS represents four common shares
of the Company. -- Total student enrollments in language training
and test preparation courses increased by 19.5% year-over-year to
approximately 1,519,500 from approximately 1,271,700 in the prior
fiscal year. -- The total number of schools and learning centers
increased to 270 as of May 31, 2009, up from 207 as of May 31,
2008. One new school was opened in the fourth quarter, bringing the
total number of schools to 48 as of May 31, 2009, up from 47 as of
February 28, 2009. The number of learning centers increased by 12
in the quarter to 222 as of May 31, 2009, up from 210 as of
February 28, 2009. Financial and Student Enrollments Summary -
Fourth Quarter and Fiscal Year 2009 (US$ in thousands, except per
ADS data and student enrollments) Q4 of FY2009 Q4 of FY2008 Pct.
Change Net revenues 59,426 40,168 47.9% Non-GAAP net income (1)
7,122 4,507 58.0% GAAP net income 2,640 1,762 49.8% Non-GAAP
operating income (1) 6,979 2,537 175.1% GAAP operating income 2,497
(208) 1300.5% Non-GAAP net income per ADS basic (1)(2) 0.19 0.12
58.4% Non-GAAP net income per ADS diluted (1)(2) 0.19 0.12 60.5%
GAAP net income per ADS basic (2) 0.07 0.05 50.2% GAAP net income
per ADS diluted (2) 0.07 0.05 52.2% Total student enrollments in
language training and test preparation courses 330,200 305,200 8.2%
FY2009 FY2008 Pct. Change Net revenues 292,567 201,003 45.6%
Non-GAAP net income (1) 77,766 57,755 34.6% GAAP net income 61,016
49,013 24.5% Non-GAAP operating income (1) 77,670 54,077 43.6% GAAP
operating income 60,920 45,335 34.4% Non-GAAP net income per ADS
basic (1)(2) 2.09 1.54 35.5% Non-GAAP net income per ADS diluted
(1)(2) 2.03 1.48 37.2% GAAP net income per ADS basic (2) 1.64 1.31
25.2% GAAP net income per ADS diluted (2) 1.59 1.25 26.9% Total
student enrollments in language training and test preparation
courses 1,519,500 1,271,700 19.5% (1) New Oriental provides net
income, operating income, net income per ADS on a Non-GAAP basis
that excludes share-based compensation expenses to reflect
meaningful supplemental information regarding its performance and
liquidity. For more information on these Non-GAAP financial
measures, please see the table captioned "Reconciliations of
Non-GAAP measures to the most comparable GAAP measures" set forth
at the end of this release. (2) Each ADS represents four common
shares. "We are pleased to finish our 2009 fiscal year with a
strong fourth fiscal quarter, recording revenue growth of 47.9% and
even higher non-GAAP operating income growth of 175%," said Michael
Yu, New Oriental's chairman and chief executive officer. "This
brings our net revenue for the 2009 fiscal year to US$292.6
million, an increase of 45.6% year-over-year, and non-GAAP
operating income to US$77.7 million for the fiscal year, an
increase of 43.6% year-over-year. Further, we achieved non-GAAP EPS
of US$2.09 per ADS, up over 35% year-over-year. We attained these
financial results notwithstanding the current global economic
slowdown, the aftermath of the Sichuan earthquake, the negative
impact of the Beijing Olympics on our all-important summer quarter
in 2008 and the current challenges posed by the H1N1 flu outbreak.
This is a testament to the strength of the New Oriental brand in
China and the determination of Chinese families to make the
education of their child or children a top priority." "New
Oriental's objective is to be the lifelong education partner of
Chinese students from age five through adulthood. To accomplish
this goal, we strive to provide the best quality language training
and test preparation programs to meet the needs of Chinese
families," concluded Mr. Yu. New Oriental's president and chief
financial officer, Louis T. Hsieh, stated, "Our strong student
enrollment growth in language training and test preparation courses
continued in fiscal year 2009 with 1,519,500 enrollments, an
increase of 19.5% year-over-year, which allowed us to achieve our
target of between 1,475,000 and 1,500,000 student enrollments for
fiscal year 2009. We also continued executing our expansion plan in
the fourth fiscal quarter by opening one new school in the city of
Xuzhou and adding a net of 12 new learning centers in more than 10
existing cities. Including these additions, we added a total of 63
new facilities in fiscal year 2009, consisting of 7 schools and 56
learning centers, which brings our total number of schools and
learning centers to 270 at the end of fiscal year 2009." Mr. Hsieh
continued, "We have rolled out U-Can all-subjects middle and high
school training program in more than 30 cities throughout China
with enrollments of more than 13,000 in non-English subject classes
in the fourth fiscal quarter, which brings the enrollments in
non-English courses for the whole fiscal year 2009 to over 58,000,
exceeding the top end of our target of 40,000 to 50,000. We are
also pleased to see continued high growth in our POP Kids English
program for ages 5 to 12 with over 67,400 enrollments in the fourth
fiscal quarter, an increase of 48% year-over-year, bringing our
total POP Kids enrollments for fiscal year 2009 to over 307,800, an
increase of 50% year-over-year. Although it is early in the
quarter, we are pleased to report that this strong momentum in POP
Kids English and middle school U-Can program enrollments has
carried into our current all-important summer quarter, the first
quarter of fiscal year 2010." Recent Developments -- Adoption of
Share Repurchase Program On July 20, 2009, New Oriental's board of
directors authorized the repurchase of up to US$30 million of the
Company's ADSs during the period from August 5, 2009 through
December 31, 2009. Under this share repurchase program, the ADSs
will be purchased from time to time on the open market at
prevailing market prices, in negotiated transactions off the
market, in block trades, pursuant to a 10b5-1 plan (which allows
New Oriental to repurchase its ADSs during periods in which it may
be in possession of material non-public information) or otherwise,
subject to any restrictions under applicable law. The timing and
extent of any purchases will depend upon market conditions, the
trading price of ADSs and other factors. New Oriental expects to
implement this share repurchase program in a manner consistent with
market conditions and the interests of the shareholders. New
Oriental's board of directors will review the share repurchase
program periodically, and may authorize adjustment of its terms and
size accordingly. New Oriental plans to fund repurchases made under
this program from available cash balance. Financial Results for the
Fiscal Quarter Ended May 31, 2009 For the fourth fiscal quarter of
2009, New Oriental reported net revenues of US$59.4 million,
representing a 47.9% increase year-over-year. Net revenues from
educational programs and services for the fourth fiscal quarter
were US$51.3 million, representing a 45.7% increase year-over-year.
The growth was mainly driven by the increase in the number of
student enrollments in language training and test preparation
courses. Total student enrollments in language training and test
preparation courses in the fourth quarter of fiscal year 2009
increased by 8.2% year-over-year to approximately 330,200 from
approximately 305,200 in the same period of the prior fiscal year.
Non-GAAP operating costs and expenses for the quarter were US$52.4
million, a 39.4% increase year-over-year. GAAP operating costs and
expenses for the quarter were US$56.9 million, a 41.0% increase
year-over-year. Cost of revenues increased by 45.9% year-over-year
to US$25.8 million, primarily due to the increased number of
courses and the greater number of schools and learning centers in
operation. Selling and marketing expenses increased by 36.8%
year-over-year to US$10.3 million, primarily due to selling and
marketing department headcount, which includes registration
verification personnel, increasing by about 500 over the same
period of the prior fiscal year, and increased brand promotion
expenses. Non-GAAP general and administrative expenses were US$16.6
million, a 30.7% increase year-over-year. GAAP general and
administrative expenses for the quarter increased by 37.4%
year-over-year to US$20.9 million, primarily due to increased
headcount as the Company expanded its network of schools and
learning centers. Total share-based compensation expenses, which
were allocated to related operating costs and expenses, increased
by 63.3% to US$4.5 million in the fourth quarter of fiscal year
2009 from US$2.7 million in the same period of the prior fiscal
year. Approximately US$746,000 of the increase was due to a
year-end adjustment to account for a lower-than-expected forfeiture
rate in fiscal year 2009 due to the fact that fewer New Oriental
employees who received stock-based compensation awards left the
Company and forfeited their unvested awards than anticipated.
Non-GAAP income from operations for the quarter was US$7.0 million,
a 175.1% increase from US$2.5 million in the same period of the
prior fiscal year, and GAAP income from operations for the quarter
was US$2.5 million, compared to a loss of US$0.2 million in the
same period of the prior fiscal year. Non-GAAP operating margin for
the quarter was 11.7%, compared to 6.3% in the same period of the
prior fiscal year. GAAP operating margin for the quarter was 4.2%,
compared to negative 0.5% in the same period of the prior fiscal
year. This rise was primarily due to improved operating efficiency
as revenue growth outpaced the growth in operating cost and
expenses. Non-GAAP net income was US$7.1 million, representing a
58.0% increase from the same period of the prior fiscal year. Basic
and diluted earnings per ADS excluding share-based compensation
expenses (Non-GAAP) were US$0.19 and US$0.19, respectively. GAAP
net income for the quarter was US$2.6 million, representing a 49.8%
increase from the same period of the prior fiscal year. Basic and
diluted earnings per ADS were US$0.07 and US$0.07, respectively.
Capital expenditures for the quarter were US$2.9 million, which
were primarily used to add one new school and a net of 12 new
learning centers in the quarter. As of May 31, 2009, New Oriental
had cash and cash equivalents of US$254.8 million, as compared to
US$224.0 million as of February 28, 2009. In addition, the Company
had US$59.8 million in term deposits at the end of the quarter. Net
operating cash flow for the fourth quarter of fiscal year 2009 was
approximately US$28 million. The deferred revenue balance, which is
cash collected from registered students for courses and recognized
proportionally as revenue as the instructions are delivered, at the
end of the fourth quarter of fiscal year 2009 was US$74.8 million,
an increase of 26.3% as compared to US$59.2 million at the end of
the fourth quarter of fiscal year 2008. Financial Results for the
Fiscal Year Ended May 31, 2009 For the fiscal year ended May 31,
2009, New Oriental reported net revenues of US$292.6 million, a
45.6% increase year-over-year. Net revenues from educational
programs and services for the fiscal year ended May 31, 2009 were
US$266.4 million, representing a 44.8% increase year-over-year. The
growth was mainly driven by the increase in the number of student
enrollments in language training and test preparation courses.
Total student enrollments in language training and test preparation
courses for the fiscal year ended May 31, 2009 increased by 19.5%
year-over-year to approximately 1,519,500 from approximately
1,271,700 in the fiscal year ended May 31, 2008. Non-GAAP income
from operations for the fiscal year ended May 31, 2009 was US$77.7
million, a 43.6% increase year-over-year. GAAP income from
operations for the fiscal year ended May 31, 2009 was US$60.9
million, a 34.4% increase year-over-year. Non-GAAP operating margin
for the fiscal year ended May 31, 2009 was 26.5%, compared to 26.9%
for the fiscal year ended May 31, 2008. GAAP operating margin for
the fiscal year ended May 31, 2009 was 20.8%, compared to 22.6% for
the fiscal year ended May 31, 2008. Non-GAAP net income for the
fiscal year ended May 31, 2009 was US$77.8 million, a 34.6%
increase year-over-year. Non-GAAP basic and diluted earnings per
ADS for the fiscal year ended May 31, 2009 were US$2.09 and
US$2.03, respectively. GAAP net income for the fiscal year ended
May 31, 2009 was US$61.0 million, representing a 24.5% increase
year-over-year. GAAP basic and diluted earnings per ADS for the
fiscal year ended May 31, 2009 were US$1.64 and US$1.59,
respectively. Outlook for First Quarter of Fiscal Year 2010 New
Oriental expects its total net revenues in the first quarter of
fiscal year 2010 (June 1, 2009 to August 31, 2009) to be in the
range of US$146.6 million to US$152.6 million, representing
year-over-year growth in the range of 24% to 29%, respectively.
This forecast reflects New Oriental's current and preliminary view,
which is subject to change. Conference Call Information New
Oriental's management will host an earnings conference call at 8 AM
on July 21, 2009 U.S. Eastern Time (8 PM on July 21, 2009
Beijing/Hong Kong time). Dial-in details for the earnings
conference call are as follows: US: +1.617.213.8838 Hong Kong:
+852.3002.1672 UK: +44.207.365.8426 Please dial-in 10 minutes
before the call is scheduled to begin and provide the passcode to
join the call. The passcode is "New Oriental earnings call." A
replay of the conference call may be accessed by phone at the
following number until July 28, 2009: International:
+1.617.801.6888 Passcode: 74420799 Additionally, a live and
archived webcast of the conference call will be available at
http://investor.neworiental.org/ . About New Oriental New Oriental
is the largest provider of private educational services in China
based on the number of program offerings, total student enrollments
and geographic presence. New Oriental offers a wide range of
educational programs, services and products consisting primarily of
English and other foreign language training, test preparation
courses for major admissions and assessment tests in the United
States, the PRC and Commonwealth countries, primary and secondary
school education, development and distribution of educational
content, software and other technology, and online education. New
Oriental's ADSs, each of which represents four common shares,
currently trade on the New York Stock Exchange under the symbol
'EDU.' For more information about New Oriental, please visit
http://english.neworiental.org/ . Safe Harbor Statement This
announcement contains forward-looking statements. These statements
are made under the "safe harbor" provisions of the U.S. Private
Securities Litigation Reform Act of 1995. These forward-looking
statements can be identified by terminology such as "will,"
"expects," "anticipates," "future," "intends," "plans," "believes,"
"estimates" and similar statements. Among other things, the outlook
for the first quarter of fiscal year 2010 and quotations from
management in this announcement, as well as New Oriental's
strategic and operational plans, contain forward-looking
statements. New Oriental may also make written or oral
forward-looking statements in its periodic reports to the U.S.
Securities and Exchange Commission, in its annual report to
shareholders, in press releases and other written materials and in
oral statements made by its officers, directors or employees to
third parties. Statements that are not historical facts, including
statements about New Oriental's beliefs and expectations, are
forward-looking statements. Forward-looking statements involve
inherent risks and uncertainties. A number of factors could cause
actual results to differ materially from those contained in any
forward-looking statement, including but not limited to the
following: our growth strategies; our future business development,
results of operations and financial condition; our ability to
attract students without a significant decrease in course fees; our
ability to continue to hire, train and retain qualified teachers;
our ability to maintain and enhance our "New Oriental" brand; our
ability to effectively and efficiently manage the expansion of our
school network and successfully execute our growth strategy; the
outcome of ongoing, or any future, litigation or arbitration,
including those relating to copyright and other intellectual
property rights; competition in the private education sector in
China; changes in our revenues and certain cost or expense items as
a percentage of our revenues; the expected growth of the Chinese
private education market; Chinese governmental policies relating to
private educational services and providers of such services; and
general economic conditions in China. Further information regarding
these and other risks is included in our annual report on Form 20-F
and other documents filed with the Securities and Exchange
Commission. New Oriental does not undertake any obligation to
update any forward-looking statement, except as required under
applicable law. All information provided in this press release and
in the attachments is as of the date of this press release, and New
Oriental undertakes no duty to update such information, except as
required under applicable law. About Non-GAAP Financial Measures To
supplement New Oriental's consolidated financial results presented
in accordance with GAAP, New Oriental uses the following measures
defined as non-GAAP financial measures by the SEC: net income
excluding share-based compensation expenses, operating income
excluding share-based compensation expenses, operating costs and
expenses excluding share-based compensation expenses, general and
administrative expenses excluding share-based compensation
expenses, operating margin excluding share-based compensation
expenses, and basic and diluted net income per ADS and per share
excluding share-based compensation expenses. The presentation of
these non-GAAP financial measures is not intended to be considered
in isolation or as a substitute for the financial information
prepared and presented in accordance with GAAP. For more
information on these non-GAAP financial measures, please see the
table captioned "Reconciliations of non-GAAP measures to the most
comparable GAAP measures" set forth at the end of this release. New
Oriental believes that these non-GAAP financial measures provide
meaningful supplemental information regarding its performance and
liquidity by excluding share-based compensation expenses that may
not be indicative of its operating performance from a cash
perspective. New Oriental believes that both management and
investors benefit from referring to these non-GAAP financial
measures in assessing its performance and when planning and
forecasting future periods. These non-GAAP financial measures also
facilitate management's internal comparisons to New Oriental's
historical performance and liquidity. New Oriental computes its
non-GAAP financial measures using the same consistent method from
quarter to quarter. New Oriental believes these non-GAAP financial
measures are useful to investors in allowing for greater
transparency with respect to supplemental information used by
management in its financial and operational decision making. A
limitation of using these non-GAAP measures is that they exclude
share-based compensation charge that has been and will continue to
be for the foreseeable future a significant recurring expense in
our business. Management compensates for these limitations by
providing specific information regarding the GAAP amounts excluded
from each non-GAAP measure. The accompanying tables have more
details on the reconciliations between GAAP financial measures that
are most directly comparable to non-GAAP financial measures. NEW
ORIENTAL EDUCATION & TECHNOLOGY GROUP INC. CONDENSED
CONSOLIDATED BALANCE SHEETS (In thousands) As of May 31 As of
February 28 2009 2009 (Unaudited) (Unaudited) USD USD ASSETS:
Current assets: Cash and cash equivalents 254,772 223,955
Restricted cash 540 531 Term deposits 59,845 62,549 Accounts
receivable, net 1,539 1,375 Inventory 15,188 14,514 Deferred tax
assets-Current 1,621 1,141 Prepaid expenses and other current
assets 14,222 16,053 Total current assets 347,727 320,118 Property,
plant and equipment, net 109,785 109,373 Land use right, net 3,485
3,499 Amounts due from related parties 396 395 Deferred tax assets
1,077 1,833 Long term deposit 2,021 -- Long term prepaid rent 1,331
1,439 Intangible assets 866 909 Goodwill 2,712 2,159 Long term
investment 2 2 Total assets 469,402 439,727 LIABILITIES, MINORITY
INTEREST AND SHAREHOLDERS' EQUITY Current liabilities: Accounts
payable-trade 9,295 9,194 Accrued expenses and other current
liabilities 29,815 28,426 Income tax payable 3,728 4,962 Amount due
to related parties 141 54 Deferred revenue 74,782 55,423 Total
current liabilities 117,761 98,059 Deferred tax liabilities 157 --
Total long-term liabilities 157 -- Total liabilities 117,918 98,059
Minority interest 238 -- Total shareholders' equity 351,246 341,668
Total liabilities, minority interest and shareholders' equity
469,402 439,727 NEW ORIENTAL EDUCATION & TECHNOLOGY GROUP INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (In thousands
except for per share and per ADS amounts) For the Three Months
Ended May 31 2009 2008 (Unaudited) (Unaudited) USD USD Net
Revenues: Educational Programs and services 51,337 35,226 Books and
others 8,089 4,942 Total net revenues 59,426 40,168 Operating costs
and expenses (note 1): Cost of revenues 25,771 17,669 Selling and
marketing 10,250 7,492 General and administrative 20,908 15,215
Total operating costs and expenses 56,929 40,376 Operating income
(loss) 2,497 (208) Other income, net 794 1,119 Provision for income
taxes (413) 806 Minority interest, net of taxes (238) 45 Net Income
2,640 1,762 Net income per share-basic 0.02 0.01 Net income per
share-diluted 0.02 0.01 Net income per ADS-basic (note 2) 0.07 0.05
Net income per ADS-diluted (note 2) 0.07 0.05 Notes: Note 1:
Share-based compensation expenses (in thousands) are included in
the operating costs and expenses as follows: For the Three Months
Ended May 31 2009 2008 (Unaudited) (Unaudited) USD USD Cost of
revenues 138 206 Selling and marketing 63 41 General and
administrative 4,281 2,498 Total 4,482 2,745 Note 2: Each ADS
represents four common shares. NEW ORIENTAL EDUCATION &
TECHNOLOGY GROUP INC. RECONCILIATION OF NON-GAAP MEASURES TO THE
MOST COMPARABLE GAAP MEASURES (In thousands except share and per
ADS amounts) For the Three Months Ended May 31 2009 2008
(Unaudited) (Unaudited) USD USD General and administrative expenses
20,908 15,215 Share-based compensation expense in general and
administrative expenses 4,281 2,498 Non-GAAP general and
administrative expenses 16,627 12,717 Total operating costs and
expenses 56,929 40,376 Share-based compensation expenses 4,482
2,745 Non-GAAP operating costs and expenses 52,447 37,631 Operating
income (loss) 2,497 (208) Share-based compensation expenses 4,482
2,745 Non-GAAP operating income 6,979 2,537 Operating margin 4.2%
-0.5% Non-GAAP operating margin 11.7% 6.3% Net income 2,640 1,762
Share-based compensation expense 4,482 2,745 Non-GAAP net income
7,122 4,507 Net income per ADS - basic (note 1) 0.07 0.05 Net
income per ADS - diluted (note 1) 0.07 0.05 Non-GAAP net income per
ADS - basic (note 1) 0.19 0.12 Non-GAAP net income per ADS -
diluted (note 1) 0.19 0.12 Weighted average shares used in
calculating basic net income per ADS (note 1) 149,633,634
149,975,585 Weighted average shares used in calculating diluted net
income per ADS (note 1) 153,578,336 155,980,034 Note 1: Each ADS
represents four common shares. NEW ORIENTAL EDUCATION &
TECHNOLOGY GROUP INC. CONDENSED CONSOLIDATED STATEMENTS OF
OPERATIONS (In thousands except for per share and per ADS amounts)
For the Year Ended May 31 2009 2008 (Unaudited) (Unaudited) USD USD
Net Revenues: Educational Programs and services 266,389 183,917
Books and others 26,178 17,086 Total net revenues 292,567 201,003
Operating costs and expenses (note 1): Cost of revenues 112,011
77,219 Selling and marketing 38,947 25,617 General and
administrative 80,689 52,832 Total operating costs and expenses
231,647 155,668 Operating income 60,920 45,335 Other income, net
7,189 7,149 Provision for income taxes (7,256) (3,644) Minority
interest, net of taxes 163 173 Net Income 61,016 49,013 Net income
per share-basic 0.41 0.33 Net income per share-diluted 0.40 0.31
Net income per ADS-basic (note 2) 1.64 1.31 Net income per
ADS-diluted (note 2) 1.59 1.25 Notes: Note 1: Share-based
compensation expenses (in thousands) are included in the operating
costs and expenses as follows: For the Year Ended May 31 2009 2008
(Unaudited) (Unaudited) USD USD Cost of revenues 316 707 Selling
and marketing 225 226 General and administrative 16,209 7,809 Total
16,750 8,742 Note 2: Each ADS represents four common shares. NEW
ORIENTAL EDUCATION & TECHNOLOGY GROUP INC. RECONCILIATION OF
NON-GAAP MEASURES TO THE MOST COMPARABLE GAAP MEASURES (In
thousands except share and per ADS amounts) For the Year Ended May
31 2009 2008 (Unaudited) (Unaudited) USD USD General and
administrative expenses 80,689 52,832 Share-based compensation
expense in general and administrative expenses 16,209 7,809
Non-GAAP general and administrative expenses 64,480 45,023 Total
operating costs and expenses 231,647 155,668 Share-based
compensation expenses 16,750 8,742 Non-GAAP operating costs and
expenses 214,897 146,926 Operating income 60,920 45,335 Share-based
compensation expenses 16,750 8,742 Non-GAAP operating income 77,670
54,077 Operating margin 20.8% 22.6% Non-GAAP operating margin 26.5%
26.9% Net income 61,016 49,013 Share-based compensation expense
16,750 8,742 Non-GAAP net income 77,766 57,755 Net income per ADS -
basic (note 1) 1.64 1.31 Net income per ADS - diluted (note 1) 1.59
1.25 Non-GAAP net income per ADS - basic (note 1) 2.09 1.54
Non-GAAP net income per ADS - diluted (note 1) 2.03 1.48 Weighted
average shares used in calculating basic net income per ADS (note
1) 149,090,088 149,992,200 Weighted average shares used in
calculating diluted net income per ADS (note 1) 153,528,173
156,449,101 Note 1: Each ADS represents four common shares. For
investor and media inquiries, please contact: In China: Ms. Sisi
Zhao New Oriental Education and Technology Group Inc. Tel:
+86-10-6260-5566 x8203 Email: Ms. Cynthia He Brunswick Group LLC
Tel: +86-10-6566-9504 Email: In the U.S.: Ms. Kate Tellier
Brunswick Group LLC Tel: +1-212-333-3810 Email: DATASOURCE: New
Oriental Education and Technology Group Inc. CONTACT: In China, Ms.
Sisi Zhao of New Oriental Education and Technology Group Inc.,
+86-10-6260-5566 x8203, , or Cynthia He of Brunswick Group LLC,
+86-10-6566-9504, ; or In the U.S., Kate Tellier of Brunswick Group
LLC, +1-212-333-3810, Web site: http://english.neworiental.org/
http://investor.neworiental.org/
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